Money Smart in Your 50s
Financially, your 50’s can be low key or a bit of a chaotic rush. If you are on track for retirement, and have your debt paid down or paid off completely, there might be very little you need to think about financially. In this case, you can focus on optimizing other savings, or larger purchases to carry you through retirement. If you are still catching up on retirement, you may be concerned about meeting your goals, but it is still possible to get where you need to be by your projected retirement date.
Why It’s Important
Retirement is just around the corner. Where before you might have had 20 or more years to catch up, the deadline is looming nearer. Your healthcare needs may also be changing, children may be moving out, and your career may be stabilizing. Your 50’s can set the tone for retirement, not only for your finances but also for your lifestyle.
How To Do It
Not sure where to start? Our tips below will help you get on track and stay there throughout your 50’s and beyond:
1. Make Sure You Know What You Need To Know.
Retirement timing and procedures can vary by industry. You may have a retirement age in mind, and contributions regularly going into your fund, but there may be more you need to have lined up before retirement takes effect. If there are any conditions that need to be met or ways to optimize your retirement that you aren’t aware of, now is the time to find out and take steps to fulfill them. For example, government employees may have years of service to complete or other conditions before they are able to retire. Or some industries allow for higher retirements benefits based on years of service or level of performance. You can easily find this information by checking with your human resources department, scheduling a consultation with a financial advisor, or searching the internet for common retirement issues for your industry.
There’s no reason to wait till retirement to downsize. Now is an optimal time to downsize everything: your spending, the size of your home, and unnecessary clutter, to name a few. Downsizing now can simplify your life and your spending, freeing up more money to put towards retirement and more peace of mind for you. Less really is more here.
3. Create A Retirement Plan.
For this tip, we are talking about a retirement plan beyond your savings account. Take some time to visualize how you want to spend your retirement, and what you need to accomplish that. Will you need a new home? A recreational vehicle? More funds to travel? A reliable car or maybe a boat for fun? Freedom to support your other family members either with time or money? Pursue your hobbies and passions? Will you need to remodel or add on to your home or save up to purchase the vehicles so you aren’t stuck with unmanageable debt in retirement? Next, take those items and figure out what you will need to do to make your plan a reality.
4. Make Sure You Are Properly Insured.
Sufficient health insurance can save you money in the long run by keeping medical costs down as your healthcare needs increase. Now is the time (if you haven’t already) to switch to a plan with lower co-pay costs on visits to the doctor and hospital and better pharmaceutical coverage. Now is also the time to make sure your life insurance policies are still current and sufficient. Many people also switch to whole life insurance or add whole life to their term insurance, as whole life rates will only increase with age or become unavailable. Schedule a consultation with a financial advisor or insurance specialist to find out what type of life insurance you need. Finally, often overlooked, but important – disability insurance. The older you get, the more likely you may need extended or permanent leave from employment due to disability. Keep the unexpected from derailing your retirement plans by looking into disability insurance right away.
5. Prioritize Your Health.
The best way to enjoy retirement, and keep medical costs down, is by making your health a priority. That may mean losing weight, or just being more active. It may mean working less or finding time for things that fulfill you. And don’t forget to prioritize your mental health while you are at it. Therapy, even on a limited basis, may be beneficial to make sure you are the best you for yourself and loved ones during retirement.